When to flout conventional financial wisdom

Conventional financial wisdom: Start saving for your child's college in a dedicated education fund while he or she is still in diapers.

Instead: Save where it makes the most financial sense, which is often in a retirement account -- specifically, a Roth IRA. Then, review options closer to college, says CFP Robert Schmansky of Clear Financial Advisors in Bloomfield Hills, Mich.

Why: Parents do want to save specifically for their children's college, especially if they're still paying off their own loans, Schmansky says. "But using college savings plans such as 529s has its drawbacks. Among them are: the limited and sometimes costly investment options, the necessity the funds are used for college and that you have additional record keeping to take care of," he says. With a retirement account, especially a Roth IRA, you keep your investment costs lower, and you can use the money for multiple goals -- including college, he says.

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